Inpixon
Q4 2016 Earnings Call Transcript

Published: 17 Apr 2017

[Operator:]

Good afternoon, and welcome to the Inpixon Earnings Conference Call for the Quarter Ended December 31, 2016. All participants will be in listen-only mode. [Operator Instructions] After today's presentation there will be an opportunity to ask questions. [Operator Instructions] A replay of the call will be available approximately one hour after the end of call through April 30, 2017. I would like to now turn the conference over to Scott Gordon, President of CORE IR, the company's Investor Relations firm. Please go ahead, sir.

[Scott Gordon:]

Thank you, Philip, and thank you for joining today's conference call to discuss Inpixon's corporate developments and financial results for the year ended December 31, 2016. With us today are Nadir Ali, the company's CEO; and Kevin Harris. At 4

[Nadir Ali:]

Thanks, Scott, and good afternoon, everyone. Welcome to our 2016 fiscal year end earnings call and corporate update, and thank you for joining us. I'm here today with Kevin Harris, our CFO, who will be discussing our financial results for the year ended December 31, 2016, after my opening remarks, and I will return to conclude our prepared remarks and field your questions. Sysorex is now known as Inpixon. On March 1, we re-branded our business to focus on growing our indoor positioning analytics products and services to increase our market share in this combined $12 billion industry, which is expected to grow to $40 billion by 2021. Indoor positioning has become a reality and priority for customers for several reasons. Mobile devices have proliferated making it possible to detect and interact with people in premises, technologies have advanced to provide better positioning, and the need for brick and mortar companies to integrate their physical and digital retail presence has become essential, just as securing IoT devices indoors is a top priority for enterprise and government customers. At Inpixon, we believe we have the most unique and advanced technology for indoor positioning analytics with the combination of our cellular, Wi-Fi and Bluetooth detection along with our real-time analytics to deliver on these requirements. In addition to our government customer base, we have several retail customers, including our largest deployment to date in Q4, 2016, in a flagship mall of one of the premier and larger mall operators in the world, further establishing our foothold in this business. While we incubated and nurtured the development of sophisticated sensor technologies and a super smart analytics engine, we also remain steadfast in the stewardship of the VAR business. Nonetheless, our financial results for the year were impacted by the decline in the Stores and Computing segment revenues that we've discussed on the last two earnings calls. This is an industry-wide trend as customers move to cloud computing and newer technologies emerge as widely reported by IDC, Barclays, and others. We have addressed this decline with the acquisition of the Integrio business in November, 2016. This acquisition provides a wider range of products and services for us to sell to primarily federal government customers. We captured revenue from this acquisition in Q1, but expect a larger impact in subsequent quarters as the government buying season kicks into gear in Q3. Revenue from Integrio is accretive and long-term, typically five to 10-year contracts, and can help sustain and grow this segment. Adding the government vertical we're expanding into new geographies with the options available to us to grow this segment of our business. We chose the government vertical option because historically it is a space that we understand and have experience in. In addition to adding revenues with Integrio, we are consolidating and cutting operational expenses as Kevin will discuss later on. We recently hired Zaman Khan as President for Inpixon Federal, which includes the Integrio business and the former Sysorex Government Services business. Zaman was previously with Intelligent Decisions for 20 years, and brings deep expertise and experience to substantially grow Inpixon's presence in the federal government. We believe these steps, along with focusing our efforts to grow the Inpixon product line will get us back on track in 2017, with revenue growth and more efficient operations. Now, I'd like to provide further color around Inpixon. Our Indoor Positioning Analytics Products or IPA, formerly known as AirPatrol and LightMiner is a purposeful solution that focuses on providing GPS-like capabilities for the indoors. In the 1960s, when GPS was first introduced it brought in a new aspect in navigation by introducing three-dimensional positioning to within a meter of accuracy. Albeit defense agencies' introduced technology, it was soon adopted for civilian use and now, most if not all of our outdoor life is somehow facilitated and contextualized by GPS. The operative word here is outdoors, because GPS technology renders ineffective indoors. Indoor areas, such as buildings, shopping malls, airports, hospitals, stadiums, and many other covered areas require positional information as well. We spend three-fourths of our lives indoors. With the advent of the Internet of Things and mobile technology, we are more connected with our physical and digital lives than ever before. In fact, our physical and digital personas are intertwined in the simplest as well as complex of ways. All these new IoT applications in existing mobile technologies and apps will require the contextual knowledge of the position of the entity, be it an object or a person in the indoors. Inpixon's IPA is that contextual solution that provides the information about a position and the intelligence about that location, and furthermore can be integrated with other big data. Our Analytics Engine offers insight and uncovers numerous potentials, some of which we and our customers are not yet aware of. A few other technologies have tried to solve the indoor positioning challenge, namely Wi-Fi and beacons. Gartner analysts, industry experts, and other customers all agree with the fact that traditional Wi-Fi and beacon-centric technologies pose a fundamental challenge to the effort of collecting rich data about any given location. Those technologies have limitations that result in collecting only a fraction of positioning data. This limited sample data is [indiscernible] and can drive marketing, campaign planning, seasonal merchandising, and customer service. Wi-Fi technologies provide local wide area networks which arguably can approximate location with 10 to 20 meters at best of the signed-on user, and don't scan as frequently as needed to understand customer journey. These technologies are not meant for providing three-dimensional positioning down to one-to-two meter accuracy. But Inpixon's technology is meant for that because our sensors are designed exactly for this purpose. They are placed closer together than Wi-Fi access points, scan more frequently for signals, capture cellular in addition to Wi-Fi and Bluetooth, and therefore can tri-laterate the location more precisely. Since we acquired the AirPatrol technology years ago, we've been constantly improving our purpose-built IPA sensors to provide an arm's-length accuracy, and we are getting better every day. If we consider the indoor space of 1,500 enclosed shopping malls, 115,000 shopping centers, 5,627 hospitals, 37 major airports, plus 122 smaller airports, and 16,000 large business establishments with 500-plus employees in the U.S., it gives us an approximate covered area of two million acres. These two million acres of covered space requires the context that location information can provide. As brick and mortar businesses drive towards using innovative IoT technologies, digital displays, augmented reality, virtual reality, and numerous big data platforms, like IBM's Watson, the need for accurate location data will also grow to provide this important contextual element. Just like GPS, Inpixon's Indoor Positioning Analytics Products were tried and tested by government agencies for several years before we introduced it to commercial customers. Our proprietary technology has matured through government requirements, and we are continuing to deliver innovative features to numerous federal agencies. For example, what started out as a real-time detection of cell and Wi-Fi now includes capabilities for our customers to address Bluesnarfing. Yes, that's a real term, and a real problem. It means the unauthorized access and theft of information from a wireless device through a Bluetooth connection often between phones, desktops, laptops, and PDAs. We'll talk about some more customer use cases momentarily. According to markets and market research, the indoor positioning market will grow from $4 billion in 2016 to $23 billion by 2021, and the location analytics market from $8 billion today to $14 billion by 2021. With IPA, we are positioned for both of these multi-billion dollar markets. We are building a SaaS-based business to provide insightful data to brick and mortar companies, physical cyber security visualization to business and government customers, increased partner networks with other IoT and mobile technology providers to deliver on cutting edge future requirements. Gartner Report states that customer focus, growth, and digitization are the top three strategic business areas for retailers. Once the sensor infrastructure is in place the return on investment from Inpixon IPA is manifold and perpetual. The possibility of how the data can help our clients and their customers today and in the future will evolve constantly, just like GPS technology did for the outdoors. Our goal is to target the two million acres of indoor space, and grow our network of sensors in those locations as quickly as possible. In that respect, to date we've just scratched the surface with approximately 50 acres. That includes our retail shopping center, financial services, and federal customers. We are working with some of our customers to provide case studies of their use cases in the second quarter. In general, without mentioning any specific customers let me give you some examples of the impact we are creating with Inpixon. One of our customers in the retail space is starting to eight times more data about customer journey than they were with existing Wi-Fi solutions. Another can trilaterate [ph] signals from multiple devices on the same individual to ascertain their location, and identify repeat visitors, therefore increasing the accuracy of the individual count. For example, if a customer came into the mall then went back to the parking lot, and returned to the mall they are not being counted twice erroneously. Similarly, we can identify and exclude employees and other staff members from customer counts. When millions of dollars are being spent for celebrity visits to a mall or a coffee promotion are organized, it is important to measure the outcome of those promotions correctly to improve on those programs. If the fundamental data, like visitor count is erroneous then any decision following that will be unreliable. Inpixon IPA is also being used to create a secured zone for enterprise building and data centers to keep unauthorized devices off their premises. Enterprises protect the doorways and gates with door locks and card readers to screen access, install close circuit cameras to monitor the premises. But these technologies do not restrict rogue devices from entering the premises, thus leading sensitive areas like board rooms and data centers vulnerable to physical cyber threats. Though the used cases for the Inpixon secured zone by financial institutions, enterprise businesses and government agencies are identifying known versus unknown devices, situational awareness, managing BYOD or bring your own device, multi-factor authentication, continuous monitoring, et cetera. By using our secured zone, visualization capabilities, our customers can then detect all kinds of devices and ascertain their location on the premises, they can track assets and devices all over the premises to protect and uphold policies. Allow the certified or known devices in secured zone and locate the unknown ones in real time, with our security zone enterprises and government agencies are connecting the physical and network security and controlling the air waves if you will, to better protect themselves and their networks from rogue devices that maybe using Bluesnarfing or other hacking techniques. Another customer using security zone visualization to detect all the IoT devices on the premises to be able to locate them on the premises and identify them as an authorized device and monitor the zone to prevent any unauthorized device from entering the area or to alert them if any known devices are moved from the area. As more wireless IoT technologies introduced in our workplace, we grow vulnerable to physical cyber security, this customer recognizes that risk and he is Inpixon to secure the workspace from wireless intrusion or trozan devices meant for data theft and/or network invasion. Let me give you another fine example of how Inpixon technology is being used. A financial customer using Inpixon to create better experience for the customer and increase security at a bank, we are creating multiple zones, like reception zone, customer service zone, waiting zone to learn about dual times and to monitor authorized and unauthorized devices. Like any new technology we had a learning curve to understand our customer persona, their immediate needs and what they're trying to accomplish. We are now positioned squarely on delivering to those requirements. One of our challenges is that our solutions are relatively unknown in the marketplace, we have been heavily focused on fixing this problem by increasing our marketing activities, since the last quarter, preparing for re-branding and gearing up public relations and media outreach to gain recognition in the market as a new Inpixon brand. You may have seen several news articles covering us. In the future you will see more of that, we are poised to take a thought leadership position in creating awareness and driving the conversation about the next generation retail stores and better customer experience in a world that is increasingly mingled with physical and digital personas. Our current pipeline consists of customers who are approximately 500 acres plus of covered space. So what does this means in terms of revenue, let's take a hypothetical example, as you know one acre equals to about 43,000 square feet, say it costs a $1 per square foot to install the sensors, therefore the costs will be $43,000. Data subscription from that acre will be $4 per square foot per year, totaling $172,000. Again these are not actual numbers because the cost depends on the few other things apart from the area of square footage. And the revenue will vary on the consumption of the data, hope it gives you an idea of our business model and how likes cell phone towers once installed in a premise, we can grow our revenue rapidly. Considering the installation investment on the front-end and adoption of new technology, many of our customers start with the pilot project before rolling out major installations, in the coming quarters expect to see more of these pilots as we will be laser focused on gaining foothold in newer strategic and new location. [Indiscernible] are mainly on a SaaS model, it will build up slowly like most SaaS companies, revenues but you will see gain traction with more coverage area that will become a very profitable recurring revenue stream. With that, I will now turn the call over to Kevin to discuss our financial results for the quarter and year-end December 31, 2016 and I will then wrap-up with a few closing comments, Kevin.

[Kevin Harris:]

Thanks, Nadir. Total revenue for the fourth quarter of 2016 was $14.5 million, revenues for the year ended December 31, 2016 were $53.2 million compared to $67 million for the comparable period in the prior year. The decrease of $13.8 or approximately 20% is primarily associated with the decline in the storage and computing strong as Nadir mentioned earlier. Total 2016 revenue included mobile, IoT and big data products revenue of $1.6 million compared to $1.7 million for the prior year period. Storage and computing revenue of $36.1 million versus $50 million for the prior year period and SaaS revenue of $3.3 million versus $3.7 million during the prior year period and professional services revenue of $12.2 million versus $11.6 million during the prior year period. Gross profit for the fourth quarter 2016 was $4.4 million, gross profit for the year ended December 31, 2016 was $14.9 million, compared to $19.3 million in 2015. Fourth quarter 2016, gross margin was approximately 31% the gross profit margin for the year ended December 31, 2016 was approximately 28% compared to 29% for the year ended December 31, 2015. This decrease in margin is primarily based on sales mix or sales of lower margin products and services than in the prior year. GAAP net loss attributable to stockholders for the fourth quarter of 2016 was $13.9 million. GAAP net loss attributable to the stockholders for 2016 was $27.1 million compared to a net loss of $11.7 for 2015. GAAP net loss per share for the fourth quarter of 2016 was $7.51 per share, GAAP net loss per share for 2016 was $15.61 per share compared to a net loss per share of $8.30 for 2015. This increase in net loss was primarily attributable to a decrease in gross profit of approximately $4.4 and an increase in operating expenses of approximately $7.9 million which primarily relates to an increase in amortization of intangibles of $300,000 from prior year and a non-cash good impairment charge of $7.4 million net of tax. The impairment charge was primarily precipitated by the continued decline in the company's stock price and the latter part of the year and the accumulated losses as a result of investing in the IPA products formerly known as Air Patrol and LightMiner. I should note that this impairment charge does not impact our liquidity, cash flows from operation, compliance with debt covenants or our ability to execute on a broader basis. Non-GAAP net loss for the fourth quarter of 2016 was approximately $4 million, 2016 pro forma non-GAAP net loss was $12.9 million compared to a non-GAAP net loss of $4.5 million for 2015. Non-GAAP net loss per share for the fourth quarter of 2016 was $2.13 per share, 2016 pro forma non-GAAP net loss per share was $7.44 compared to a non-GAAP net loss per share of $3.20 for 2015. Non-GAAP net loss per share is defined as net loss per share and diluted share adjusted for non-cash items, including stock based comp, amortization of intangibles and one-time charges including the gain or loss of settlement of obligations, goodwill impairment, severance costs, change in the fair value of shares to be issued, acquisition costs, a provision for accounts and the costs associated with the public offering. Non-GAAP adjusted EBIDTA for the fourth quarter of 2016 was a loss of $2.8 million. Non-GAAP adjusted EBIDTA for the year ended December 31, 2016 was a loss of $9.8 million compared to a loss of $3.4 million for the year ended December 31, 2015. We define non-GAAP adjusted EBIDTA as GAAP net income or loss before interest, income taxes, depreciation and amortization plus adjustments for other income or expense items, non-recurring items and non-cash stock based compensation. On the balance sheet, we ended the year with cash and cash equivalents of approximately $1.8 million and total current assets of $30.1 million. Our net cash used in operation for the year ended December 31, 2016 was approximately $2.8 million. During 2016, the company's effort to reduce costs included the net reduction in head count, not including the Integrio acquisition of approximately 20 full time employees, which will result in an estimated annualized operating expense reduction of approximately $2.8 million. In addition, the company has identified additional cost savings associated with the consolidation of staff, which will result in the reduction of office space and lease-related costs in 2017. The company continues to identify areas where it can create operating efficiencies and realize operating cost savings in 2017 and beyond. This concludes my comments, and I'd now like to turn the call back over to Nadir. Nadir?

[Nadir Ali:]

Thanks, Kevin. I'd now like to touch on what Inpixon will be doing in 2017 to ensure that we see the results we envision. We are organizing the business into two segments, Inpixon Products and Infrastructure, which is our VAR business, and the future financial results will be reported accordingly. The Inpixon IPA product organization will be focused on pipeline building and customer acquisition in both the brick and mortar retail and security markets with our proprietary products. Our Infrastructure VAR segment will concentrate on government and commercial retailer markets. This will facilitate our transition and growth as a product company, while growing Inpixon Federal in the commercial VAR business. I remain confident that our company is on the path to profitability and success that we have all invested in. With that, Phil, I think we're ready to open the call to any questions.

[Operator:]

At this time we have allotted 30 minutes to address questions from participants. [Operator Instructions] Okay, our first question comes from Josh Nichols of B. Riley. Please go ahead.

[Josh Nichols:]

-- sort of an update on what's going on with the Daruna ramp…

[Nadir Ali:]

Josh, sorry, you cut off at the beginning of your question.

[Josh Nichols:]

Sorry, yes. I was wondering if you could provide us with a little bit of an update of what's going on with the Daruna ramp for the $91 million project that was scheduled to start up soon.

[Nadir Ali:]

Yes. We've had some recent conversations with them. As you are aware, that's a project that's been delayed due to construction issues, but they are expecting to get that started here in the next few weeks. So we definitely expect to see those revenues to start to kick in this year, I would say towards the end of Q2 or early Q3 given the delays that they've had. But we're still confident that they will get started here shortly.

[Josh Nichols:]

And then similarly, how about the $4 million upfront AirPatrol installation, how much of that has actually been realized to date?

[Nadir Ali:]

We've done a partial shipment on that. And we're expecting the rest of that to go out later this year as well. So we're -- I think it's probably less than 15% that we've already taken care of and shipped out, but the balance will happen most likely in the latter part of 2017, with possibly some deliveries in early 2018.

[Josh Nichols:]

Yes, and then lastly, what could you tell us about the preliminary results for how things are going with the mall operator, any data points you could provide or plans for expansion within that mall or another?

[Nadir Ali:]

Well, without getting into too many specifics, we can share with you that the customer has absolutely been getting significant volume of data. And I think they're realizing just as some of our other customers have, that the granularity and the amount of data is much more than they expected. So I think there's a lot to be learned and insights to be gathered from the data. We are optimistic about expanding that relationship. We've had several discussions with customers around that. So we're looking forward to updating you on the progress of that.

[Josh Nichols:]

Thanks guys, I appreciate it.

[Kevin Harris:]

Thanks, Josh.

[Operator:]

Okay, our next question comes from Ross Silver of Sylva International. Please go ahead.

[Ross Silver:]

Thanks for taking the question. So it seems to me, so I've been following the company now for a few years. And it seems like you're truly at an inflection point here. And the other part is, the information that you are gathering for your customers is critical information, and as such there seems like there's definitely going to be a recurring element to your revenues on a go-forward basis. So, I guess the question I have for you is, you look at these markets and they're massive, they're in the billions. Where would you say the company is at this point in terms of customer adoption? I know you've done a considerable amount of beta testing, you have some orders. Is it something where we're going to start to see a significant number of orders now start to come forward here in the coming quarters here, or is it still early-ish stage where you see kind of like ones and two-ies. Like, how would you describe it from your vantage point in terms of the adoption from customers?

[Nadir Ali:]

Hi, Ross, thanks. Good question. Look, we certainly have been investing some time into this, and I referred to the pilot that we're doing with our customers. We are -- I think you're right, we said at a inflection point or pivotal point where we're going to take these early adopters and pilot that we have done so, and will continue to do so in 2017, and start scaling them out. So I think there is absolutely an opportunity to ramp this up as -- most of these mall operators that we're in discussions with have multiple properties, right, in the tens of hundreds. And so we expect the ramp up after you get through the pilot to be pretty fast after that, right. So that's what we're looking at. This is a reoccurring revenue stream that we're going to start monetizing day one. And then as I talked about in the call, more monetization opportunities will present themselves as we capture more and more data. So this is something that will continue to build and generate a substantial reoccurring revenue stream. But I think we are at that inflection point. I think we're going to start scaling this faster. And part of that is the challenge I mentioned of just creating awareness of our technology, and the company, and our products and capabilities. So the marketing efforts that we've put in, we've hired a new CMO, we've engaged a PR firm. You guys have seen that news, and you're starting to see some pieces out there talking about our capabilities viz-a-viz other technologies which can't deliver the solution as comprehensively as we can. But sometimes a lot of our customers don't know we exist, and so we're going to do a better job of that to scale this up.

[Ross Silver:]

And that's just one of the things that's compelling for me just as an investor speaking here, is obviously the more people that know about your products and services the better. And so, for you to have this mall operator, who I know is one of the largest in the world, just to kind of as much, and I know the person before asked you a little bit about this. I mean, where do you stand with them in terms of sort of the adoption curve again, is it still early stage and then you start to see sort of a mass deployment, let's say, in the next four to five quarters, or is it two to three quarters, I mean, how would you describe that?

[Nadir Ali:]

No, I mean I don't -- so we've been through the pilot, if you will, with them. So I think that it's sooner rather than later with the expansion for that customer. New customers, obviously you do a pilot and then you get the rollout follow-on, right. But we have customers in various stages in our pipeline. And I think we've established several good strong retail mall operator-type customers that will scale. And by the way, not only the retail customers, there are also enterprise and government customers that just -- I've talked about one of our government agencies in the past, where we started with one building, and now we're in eight or nine of their buildings, right? So, on both products -- on the security application as well as in marketing there are opportunities to expand. And I think we'll start seeing that -- that's why when I'm talking about the square footage, and we've got 50 acres or so under out belt, but a pipeline of 500-plus acres approximately, that's what we're talking about, is closing more and more of those indoor spaces and rolling this out faster.

[Ross Silver:]

Well, great. Well thanks for that. I appreciate it. And definitely it sounds like an exciting time for the company. Thanks for taking my questions.

[Nadir Ali:]

Thanks, Ross.

[Operator:]

Okay, our next question comes from Richard Molinsky [ph] of Max Ventures. Please go ahead, Richard.

[Unidentified Analyst:]

How are you doing, guys?

[Nadir Ali:]

Hi, Rich. How are you?

[Kevin Harris:]

Hi, Rich.

[Unidentified Analyst:]

Good, thanks. As I hear the story again, and you think about the technology you have with a market cap of I guess less than $15 million, it's kind of shocking. But I also try to wonder, is there a way to try to sell off any non-core assets to try to help improve the balance sheet, so we also do any bad financing and is there any opportunity maybe showing people in the industry how unique your system is and what you can do, that you could ask them to be a participant, to be a long-term shareholder of the company, to try to help you during this year and going forward and participate on some of the deals that you have?

[Nadir Ali:]

Yes, Richard, you raised a couple of good points. I mean, obviously there is a disconnect with -- we are the company is and the market cap and some of those things are just beyond our control, but I understand what you are saying, look as I -- as a business the management team and the board obviously looks at all of its options and we will consider things that make strategic sense and are good for our shareholders. So whether it would be acquisitions or divestiture of assets or financing et cetera, we review all those possibilities on a regular basis and determine what we think, makes sense today there is opportunities to really cross-sell across our customer base and we touched on this in the past, on some of these calls that at some point maybe it makes sense to separate these businesses. But today, we are leveraging the sales force that we have; we are leveraging the customer base and the infrastructure across both segments. So, we will keep reviewing that and make those decisions as it comes to our attention and the board will review and see what make sense for shareholders.

[Unidentified Analyst:]

And last question, if I could is there a company that have a full sales force say 100, 200 people that could upsell using your technology versus just I don't know use just your sales people that go out there. How many sales people do you have hitting all these different vertical markets?

[Nadir Ali:]

Well, so our plans are to leverage our direct sales force, but absolutely as we scale and grow the business, we need to have a channel strategy and we have been working on deploying that. So we have channel partners engaged today and we are focused on signing-up a lot more, in terms of strategic partners as well as channel partners that can carry our Inpixon product line, so you will be hearing more about that, because that is certainly our plans to scale the business.

[Unidentified Analyst:]

Terrific, I look forward to it. Thank you so much Nadir, appreciate it.

[Nadir Ali:]

Thanks very much.

[Operator:]

Our next question comes from Mike Crawford from B. Riley. Please go ahead.

[Mike Crawford:]

Thanks just further to channel and related partners, what about strategic partners like Tableau, software house, your relationship progressing with that company?

[Nadir Ali:]

Yes, so we definitely at the end of 2016 started working on getting more focused around the indoor positioning and analytics and combination. So we will continue partner with Tableau and others in the visualization space. But the small microcap company with limited resources, we can't necessarily go after too many things and be everything, to everybody. So we decided as a management team and with the board's approval to really get focused on indoor positioning and analytics around that. So last year, you may heard me talk about we may take the product known as LightMiner with Tableau into some other direction. We decided to strategically put that on hold and really focus on our core peace which I think really is the future of the company and the billion dollar opportunity for us. So we have relationships with Tableau, we will continue to have that, we are going to be looking for more strategic partnership that can help us focus on the IPA story.

[Mike Crawford:]

Okay thank you and then given that one of the key attributes of your analytics ability is the speed with which you can process information but is that something that might be viewed as complementary to someone else in the data analytics business that might have more of a Hadoop-related type architecture that you would be a complementary add to it, if they were to get your capabilities into their sweet for to be more in full service solutions provider?

[Nadir Ali:]

Yes, again the way I would answer is that, we are going to say focused on our mission at hand, which is really to grow the indoor positioning analytics space, so if they are a partner or a customer that can leverage our technology and further that goal then yes, absolutely but we are not going to do is try to get de-focused or have too many different types of arrangements or partnerships that could leverage our database or our analytics engine for other used cases, right it will just be distracting to the team. So we are going to stay focused if it's within our focus area then absolutely.

[Mike Crawford:]

Okay, thanks.

[Operator:]

Okay, we have now reached our allotted time for questions. This concludes our question-and-answer session. I would like to turn the conference back over to Nadir Ali for any closing remarks

[Nadir Ali:]

All right. Thanks, Phil. Thank you everyone again for your time today. We are continuing to innovate our internal processes and strategies within our business units such as our sales and marketing efforts around our growing state of the art high value products and solution offering. What can you expect in the future? You will continue to see announcements of our new webcast series, our mounting PR efforts to leverage and champion our brands compelling value propositions as we expand our marketing and messaging to [indiscernible] press and relevant industry channels. We are also continuing to invest in our R&D to ensure that we remain at the forefront of our space and earn the accolades and client wins that we believe we warrant, such as recently being named to the 2017 CRM MSP Elite 150 list. As I mentioned on our last call, we are driving the realization out in the market that our solutions are incomparable and drive real long-term value. We are highly encouraged by the market responses, we are experiencing from our clients and prospective customers alike, who seek to drive ever more ROI from their actionable data, we will of course continue to update you on our upcoming developments and our participation at both industry and investor conferences. Thank you again for your time and continued support.

[Operator:]

The conference has now concluded, thank you for attending today's presentation you may now disconnect.